FI-CA: Credit Management

Purpose

You can use this
business process to monitor the risk of losses on receivables by setting a
credit limit for your customers.

At regular
intervals, Contract Accounts Receivable and Payable (FI-CA) transfers
the status of the creditworthiness and the open items (credit exposure) of
each customer to SAP Credit Management (FIN-FSCM-CR). When you create a
sales order for a customer in the sales system (for example, SAP ERP SD, SAP
CRM, or another external sales and distribution system), you can start a
credit check in SAP Credit Management. The system checks the
credit-relevant data of the customer and whether the sales order volume is
within the credit limit set. This enables you to recognize early whether a
customer is able to pay his open invoices and, if necessary, you can prevent
any further deliveries to the customer so that he is forced to pay his
liabilities before receiving further goods.

In this business
process, SAP Credit Management is the leading component. The components
Sales and Distribution (SD) and Contract Accounts Receivable and
Payable (FI-CA) transfer the credit-relevant data for their customers to
SAP Credit Management. There you can update, check, and evaluate this
data.

Process Flow

...

The business
process FI-CA: Credit Management consists of the following phases, which are run in
the following process steps:

The system
transfers changes in the creditworthiness of business partners in FI-CA to
SAP Credit Management.

2.Update FI-CA
creditworthiness and calculate score (FIN-FSCM-CR)

The system
calculates the score of a customer considering the FI-CA
creditworthiness.

3.Forward score to
FI-CA (FIN-FSCM-CR)

The system
forwards the current value of the score to FI-CA.

4.Update
creditworthiness in FI-CA and use for further activities in FI-CA

FI-CA uses
the creditworthiness value determined from SAP Credit Management to derive further activities, such as dunning
and processing returns.

5.Transfer credit
exposure and payment behavior summary (FI-CA)

For the
business partners required, FI-CA determines the current credit exposure and
payment behavior summary and transfers this data to SAP Credit
Management using an XI
interface.

6.Update credit
exposure and payment behavior summary (FIN-FSCM-CR)

The system
enters the data in the credit segments of the business partner in SAP
Credit Management.

7.Create sales order
(SD)

In the SD
system (for example, SAP ERP SD, SAP CRM, or another external SD system), you
create a sales order for the customer directly or based on a quotation that
the customer has accepted.

8.Call credit check
(SD)

Before
processing the sales order further, the Sales and Distribution (SD) component
makes sure that the total value of the credit exposure plus the value of the
sales order does not exceed the customer’s credit limit. To do this, the
system sends a request for a credit check to SAP Credit Management and
transfers the data of the sales order.

9.Request current
credit exposure value from FI-CA (FIN-FSCM-CR)

SAP Credit Managementrequests the credit exposure of the business partner
from FI-CA.

10.Determine and
forward current credit exposure (FI-CA)

FI-CA
determines the current value of the credit exposure and forwards the data to
SAP Credit Management.

11.Carry out credit
check (FIN-FSCM-CR)

The system
compares the credit exposure of the business partner with the credit limit in
SAP Credit Management to check whether it exceeds the credit limit. The
credit checks that the system carries out depend on the rules defined in the
credit master data of the business partner.

12.Transfer result of
credit check (FIN-FSCM-CR)

The system
summarizes the results of the individual credit checks and forwards them to
the component Sales and
Distribution(SD). The component
Sales and
Distribution (SD) saves
the result in the status of the sales order.

13.Save sales order
(SD)

If the result
of the credit check is that the credit limit is not exceeded, the system can
process the sales order further (for example, to deliver the
goods).

14.Report order value
(SD)

The sales
order now starts, for example, production or delivery of goods that the
customer pays for at a later date. The system therefore forwards the value of
the order to SAP Credit Management as a credit exposure with a specific
credit exposure category.

15.Update credit
exposure (FIN-FSCM-CR)

Using an
interface, SAP Credit Management receives the data for the new credit
exposure value for the customer; it has increased as a result of the sales
order. The system saves the order value in the items of the credit segment for
the business partner and updates the credit exposure.

16.Create billing
document (SD)

The system
forwards the billing document for the sales order to FI-CA automatically. At
the same time, it creates a message for SAP Credit Management that the
total credit exposure of the customer has been reduced by the value of the
order.

17.Create open items
(FI-CA)

Once the
billing document has been transferred, FI-CA creates open items in the
contract account of the business partner.

18.Transfer credit
exposure and payment behavior summary (FI-CA)

At regular
intervals, FI-CA forwards the current value of the credit exposure and the
payment behavior summary to SAP Credit Management (see also step
5).

19.Update credit
exposure and payment behavior summary (FIN-FSCM-CR)

When closing
the processing of the sales order, the Sales and Distribution (SD) component
forwards the invoice to FI-CA. The invoice represents the receivable due from
the customer. SAP Credit Management therefore reduces the value of the credit exposure
by the value of the sales order billed and simultaneously increases the value
of the credit exposure by the credit exposure determined from
FI-CA.

20.Create list of
credit limit utilization (FIN-FSCM-CR)

SAP Credit
Management creates a list
with details of the level of credit utilization for all business
partners.

Result

Possible results of
the credit limit check:

●The sales order was
released; the goods have been delivered to the customer.

●Credit limit,
score, risk class have changed in the business partner master
record.